Generally, most workers in Illinois are “at-will” employees. This means that employment decisions like hiring and lay off are at the will of the company. Some employees have certain rights that determine whether or how they can be laid off.  Examples are:

• Having an employment contract,
• Being a unionized worker under a Collective Bargaining Agreement,
• Where State and Federal laws prohibiting discrimination in the workplace apply,
• Where State and Federal laws prohibiting retaliation in the workplace apply,
• Where termination rules in the company handbook or other written policies apply, and
• Having job protection under laws like Family Medical Leave Act (FMLA) or Americans with Disabilities Act (ADA).

As long as the employer doesn't violate these rights, an at-will employee can be terminated for no reason at all.

What if I think I was discriminated against or retaliated by my boss when they decided to lay me off?

It is a violation of federal and state law for an employer to lay off a worker when the decision was based on discriminatory reason or in retaliation for a worker’s lawful actions. Find out more about how to file a complaint here.

Am I entitled to any severance pay or unemployment benefits?

You’re entitled to unemployment benefits if you weren’t fired for misconduct and didn’t quit. Those benefits come from the Illinois Department of Employment Security. This is funded by insurance coverage employers pay for through unemployment taxes. Find out how to apply for unemployment benefits here.

You are usually not entitled to severance pay. Generally, you’re not entitled to extra pay beyond the hours you work. Only a union agreement or employment contract will require severance pay.

If you are offered a severance agreement (also called separation agreement), you should read it carefully. Resist signing immediately. Know what rights you may be giving up. If you feel there is room for negotiating the contract, be able to support your requests before proceeding.

Final payment

Your final paycheck is supposed to be paid “in full, at the time of separation, if possible.” Otherwise, the very latest it can be paid is “the next regularly scheduled payday.” If you ask your employer to mail you a check, they must. Your employer cannot make you give up any rights when you accept and sign your final paycheck.

The company must pay you for any unpaid compensation owed to you, such as wages, earned bonuses/commissions, or other unpaid money that you earned. You should also be paid for expenses that are reimbursable under the company's expense reimbursement policy. 

Hourly (non-exempt) employees should receive payment for all hours worked, including overtime earned. Salaried (exempt) employees should receive their full weekly salary for any week where they performed any work without regard to the number of hours/days worked. So, if an exempt employee is laid off during the first day of the workweek, they will get full salary for that week.

Accrued vacation time

Some companies give their employees paid vacation and holiday time off (also called “PTO”). Illinois law requires that you get paid “the monetary equivalent” for all accumulated and unused paid time off (vacation, PTO, or holidays).  This compensation should be included in your final paycheck. Claims regarding your final paycheck should be filed online here.

Continuing healthcare coverage

COBRA law provides laid off workers with a right to continued healthcare coverage. If your employer has 20 or more workers, they must offer healthcare coverage to you and your family. Your coverage can continue under the company plan for up to 18 months. You must begin coverage within about 60 days of layoff, and you should expect to pay the full cost of the group plan, plus a 2% fee. Your employer is required to tell you about this replacement coverage option. If the company fails to fulfill these COBRA obligations, it may have to pay penalties in an enforcement action.

What's the difference between a layoff and a furlough?

In non-unionized workforces, the terms “layoff” and “furlough” are not functionally different; both cases have the same results: you aren’t working, so you won’t be paid. But some companies use the terms differently. Many employers use “layoff” where an employee was terminated or won’t be returning to work. On the other hand, “furlough” is used when the employment relationship was not ended, and the employee will return to work within a short time.

Under many employment laws, employees on furlough have the same rights as a laid off employee. A furloughed employee should receive:

• Unemployment benefits,
• A final paycheck that includes all earned compensation for their hours worked,
• Salaried (exempt) employees receive their full weekly salary for the last workweek,
• Final paychecks should be given the final workday or on the next regular payday, at the latest, and 
• COBRA notices on how to continue healthcare coverage. 

Special rights for union workers

If you are a union member working under a Collective Bargaining Agreement (CBA), you may have special rights in a layoff, such as seniority rights, severance, and special notice provisions. You should review your CBA and talk with your union rep about your questions. If you feel you were unfairly terminated, you may be required to follow a specific grievance procedure. 

Must my company give advance notice before a mass layoff, plant closing, or relocation?

Only large employers are required to give advance warning about layoffs. In Illinois, both the Federal and state Worker Adjustment and Retraining Notification Acts (WARN Acts) apply. Both WARN Acts requires certain employers to notify workers 60 days in advance of “plant closings” or “mass layoffs.”

The Illinois WARN Act covers employers with at least 75 full-time employees. For the Federal WARN, it’s 100.

The Illinois WARN Act requires notice if at least 25 full-time employees are laid off, and that layoff amounts to at least one-third of the full-time employees at a site. It’s 50 for the Federal version.

A layoff of 250 full-time employees at a singe site, regardless of what percentage of the workforce that is, also triggers the 60 days' notice under the Illinois WARN Act. Under Federal law it’s 500.

Under both, if a layoff that was supposed to be for less than 6 months extends beyond 6 months, it’s an “employment loss” that triggers the notice requirement.

Employers also must notify workers if a plant relocates. Relocation is when a plant moves and workers are not offered transfers within commuting distance.

Under both Acts, an employer who violates the law by laying off without giving proper notice is required to pay each laid off employee for up to 60 days of back pay and benefits.

There are three exceptions when an employer doesn’t have to give 60 days' notice. A “faltering company” doesn’t have to if notice would scare off investors or lenders who might save the company. And notice isn’t required if the layoff or shutdown is unforeseeable, or results from a natural disaster. Companies in these situations should still give as much notice as possible of layoffs.